• Mon. May 20th, 2024

Record 3.2% Inflation in Spain: What You Need to Know

BySamantha Nguyen

Mar 27, 2024
Spain’s Inflation Reaches 3.2% in March as VAT Returns to 21% after Three-Year Absence

In March, Spain experienced a significant increase in inflation, with prices rising by 3.2% year-on-year. This was a four-tenths increase from the previous month and marked a significant rise compared to February when prices were only 2.8% higher year-on-year.

The monthly price evolution has been on an upward trend since the beginning of the year, with prices rising by 0.1% in January, 0.4% in February, and 0.8% in March. This is the largest increase since February 2023. The underlying inflation also rose by 0.5% in monthly terms.

Despite these increases, food prices in March rose less than they did in the same month last year due to certain food products like olive oil driving the price increases rather than goods or services like gasoline and electricity that saw their tax cuts end or VAT rate return to normal levels respectively.

Provisional data released by the National Institute of Statistics suggests that underlying inflation, which excludes fresh food and energy products, will be moderated to 3.3%, the lowest rate in two years. This is a drop from 3.5% in February and marks the first time since 2022 that core inflation is above the general index but below expectations.

Overall, experts warn of potential inflationary pressures in various sectors, particularly in services where prices have been steadily increasing since the beginning of the year despite tax cuts on electricity ending and VAT rate returning to normal levels for other products like gasoline and electricity respectively.

In conclusion, while food prices rose less than expected due to certain food products driving price increases rather than goods or services like gasoline and electricity that saw their tax cuts end or VAT rate return to normal levels respectively; underlying inflation is expected to moderate compared to recent months while experts warn of potential inflationary pressures in various sectors particularly services where prices have been steadily increasing since the beginning of the year despite tax cuts on electricity ending and VAT rate returning to normal levels for other products like gasoline and electricity respectively.

By Samantha Nguyen

As a content writer at newsskio.com, I weave words to craft compelling narratives that captivate readers and bring stories to life. With a keen eye for detail and a passion for storytelling, I strive to create engaging and informative content that resonates with our audience. Whether I'm delving into the latest news trends or exploring unique angles on various topics, my goal is to deliver quality content that informs, entertains, and inspires. Join me on this journey as we uncover the news stories that matter most.

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